Abstract

This article explores the linkages between public-interest and regulatory theory. By examining academic scholarship relating to effectiveness and regulatory theory, this article proposes that there are links between agencies with a public-interest orientation and effective regulatory action. In order to examine this relationship this article analyzes three federal financial services regulators and their varying levels of effectiveness.  In order to do this analysis focuses on three types of regulatory actions.  These are technical, clientele, and public interest interventions. Next, the article looks for linkages among variations in regulatory style and agency effectiveness (in these cases as measured by regulatory ability to prevent the failures of supervised institutions). The analysis concludes by stating that there does appear to be some evidence for linkage between an agency's public interest orientation and their ability to effectively supervise a regulated community.

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